Apple and Qualcomm Settle All Lawsuits and Enter Six-Year Agreement

Apple and Qualcomm have reached a settlement. The parties worldwide are dropping all lawsuits against each other and have entered into a six-year license agreement. The companies also conclude a multi-year agreement for the supply of chips.

Part of the settlement is that Apple will pay an amount to Qualcomm. This is stated in a press release from Apple and in a press release from Qualcomm. The parties will not disclose how high that amount is. It is also not explicitly stated why Apple is transferring an amount to Qualcomm, but it seems to be about royalties. Apple stopped license payments to Qualcomm in 2017, because the iPhone maker thought the chip designer was asking too much money for it.

In addition, the companies have entered into a licensing agreement that took effect on April 1, 2019 and is valid for six years. This agreement is about the use of patents and Apple will pay royalties again, according to a slide Qualcomm has put online for investors. There is an option to extend the deal for another two years.

Apple and Qualcomm have also entered into a multi-year agreement to supply chips. The companies do not report how many years that agreement is valid and which chips it concerns. Apple mainly used Qualcomm modems, and that’s probably what this new agreement is all about. Apple designs its own socs without a modem.

Finally, both companies drop all lawsuits against each other worldwide. Lawsuits against Apple suppliers will also be dropped. This puts an end to a years-long legal battle, in which Apple and Qualcomm bombarded each other with accusations and lawsuits.

The conflict began in 2017 with a lawsuit from Apple in which the iPhone maker accused Qualcomm of charging excessive royalties and unfair competition. Qualcomm then took Apple to court in several countries for patent infringement. Numerous lawsuits followed, also involving Apple suppliers.

At the end of 2018, Qualcomm was proved right by a German judge and Apple had to remove its iPhone 7 and 8 from the shelves. Apple responded by releasing modified versions of the affected iPhones, which were equipped with a different modem. Last month, a US judge ruled in a preliminary ruling that Qualcomm would have to pay Apple a billion dollars for broken agreements. Now that Apple and Qualcomm have dropped the lawsuits, that’s no longer an issue.